competitive cities in the 21st century: cluster-based local economic development

8/3/2019 Competitive Cities in the 21st Century: Cluster-Based Local Economic Development

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Competitive Cities

in the 21st Century:

Cluster-Based Local Economic Development

Professor Brian H Roberts

International Team Leader CCED Project in South Asia

Urban Management Specialists Land Equity International

ADB Asian Urban ForumManila

15 17 November , 2011

This presentation is dedicated to my late colleague Dr Kaye Choe of theADB who passed away on the 17 October with whom I co-authored the bookwith the same title as the presentation.


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The Changing forces of

Competitiveness

Firm/Institution - Multi national Government Local regional national international Environments

Competitiveness is

focused on Internalised

Transaction costs

Competitiveness focused

on reducing Externalised

Transaction costs

Competiveness, traditionally, has been driven by the need for firms to achieve some

form of local or corporate competitive advantage. Competitiveness is driven by factors

related to the costs of production, distribution, efficiency of supply chains, access to

markets and local business environments and dynamics.

The focus of competitiveness today is on how to create collaborative advantage by

focusing on reducing internalised (firms and public organizations) costs, and

externalised transaction (supply chain, enabling environments and common-use

utility and support services) costs

For cities to develop strong sustainable economies, they must focus on how to build

the supporting elements strategic architecture, (building blocks) of competitiveness

in their internal (firm/organization) and shared (public) realms.


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CITY CLUSTER ECONOMICDEVELOPMENT

City Cluster Economic Development (CCED) is an approach to the

development of cities which seeks to foster industry cluster partnerships

to facilitate investment, innovation, develop of strong enabling

environments, generate sustainable employment and enhance the

competitiveness of cities. The focus is to support selected industryclusters which are identified as having the strongest potential for

development, growth and value adding.


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Seven Elements of CCED Approach


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Step 1- Analysis of the National Economic Policy

Environment for Cities

Policy Realms that Affect Economic Agglomerationand Clustering

Fiscal Polices

Economic DevelopmentSpatial Planning

Education and Training

Science and Innovation

Environmental


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Step 2 - Analysis of the Drivers

of Competitiveness in Cities

Analysis of cites uses AIM Philippines

Competitiveness of Cities Basic Framework

6 Drivers 49 Competitiveness Attributes

Drivers Dhaka Barisal Bogra Chittagong Comilla Khulna Mymensing Rajshahi Rangpur Sylhet

Cost of doing business 0.93 0.72 0.71 0.84 0.90 0.75 0.81 0.75 0.54 0.93Dynamics of local economy 2.06 0.65 1.39 1.88 1.33 1.20 1.21 0.73 0.70 1.65

Human resources and

training1.40 0.42 0.57 0.84 0.86 0.72 0.71 0.39 0.57 1.02

Infrastructure 1.02 0.75 0.75 1.26 0.83 0.87 0.78 0.81 0.72 0.96

Responsiveness of

government to business

needs0.87 0.27 0.33 0.63 0.42 0.39 0.36 0.30 0.21 0.36

Quality of life 1.04 0.81 0.75 0.87 0.78 0.84 0.96 0.72 0.69 0.86

Index Score 7.31 3.62 4.49 6.32 5.11 4.77 4.83 3.70 3.43 5.78

Drivers of Competitiveness Bangladesh Cities (out of 10) Overall Competitiveness Profiles of Indian Cities


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Step 3 - Sector Competitiveness of Urban EconomiesWeight C ompetitiveness Attributes

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

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City cluster analysis tools:

Shift Share Location Quotients Multi sector Analysis Spatial Analysis (GIS)


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Step 4- Industry Cluster Analysis

Strength of Competitiveness Attributes,Leather Industry

0

1

2

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4

5

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vailabil

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cutilitie

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acilities

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Attributes

Value

Analysing Strengths and Weaknesses of

Leather Industry Cluster Dhaka

Spatial Analysis of garment

Industry Cluster New Delhi


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Spatial Typology of Industry Clusters:

Garment Industry Cluster in Dhaka Central Business Area

New Industrial Areas Industrial Estates

EPZ

Sub-Regional

Concentrations Linear Industrial

Dispersed firms

Virtual


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Supply Chain Mapping of the IT Cluster Colombo


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Cluster Competitiveness Gap Analysis

Competitiveness Elements of Cluster

Current

Conditions

Score: 0 -5

Future

Competitiveness

Requirements: 0-5

Deficiencie

s Gap

FIRM STRATEGY STRUCTURE AND RIVALRY

Structure

No of foreign and joint venture firm presence 1.6 3.3 1.8

Flexibility of production systems 1.9 3.5 1.6

Identifying the current strengths and weaknesses of competitiveness attributesrelated to economic, social, infrastructure, and technology factors supporting an

industry cluster is important in helping to determine priorities for investment in

strategic infrastructure to enhance the overall competitiveness of the cluster.

This is done by using industry expert groups and a numeric scores system of the

current and future level of attribute competitiveness needed to make a cluster

regionally, nationally or internationally competitive.

The gap between the current and future level of

competitiveness helps to set priorities for interventions.

The higher the gap: the higher the priority for

intervention. 39 Gap attributes are analysed


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Enabling Environment

Catalysts

Strategic

Assets and

Infrastructure

Business

DynamicsHuman Capital

Endowed

Resources

Step 5- The Strategic Architecture Elements of

Industry Clusters

It is essential to develop strategies and supporting elements of capacity that build the

strategic assets and services meed to support the development of the clusters. These

elements are the building blocks of what, collectively, is referred to strategic

Architecture. Strategic Architecture is like a game plan that sets the pathway for building

and maintaining the supporting business elements (as shown in the figure) of the cluster.


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Step 6- Action Plans to Support Cluster

Development

The following soft activities are

part of the action plan:

1. Quality and standards

2. Productivity improvement

3. Improve use of information technology in the cluster

4. Expanded markets and enhancing market penetration

5. Improving supply chain management practices

6. Workers health and safety programmes

7. Improved access to finance8. Joint purchase of raw material

The following infrastructure activities are

proposed in the cluster:

9. Tool Room Facilities

10. Reverse Engineering and CAD/ CAM Centre

11. Testing Centre (upgrading) of QMC1

2

54

3

6

6

8

3

10 &11

9

CCED Clusters

Colombo

Apparel IndustryRubber IndustryICT Industry

Delhi

Garment IndustryLight EngineeringAuto Parts Industry

Dhaka

Ready-Made garment IndustryLeather IndustryFood Industry


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Step 7 - Implementation

Industry Cluster Partnerships involving Government, Industry,Education Research and Development)

Rubber Industry Cluster (Colombo)

Industry Clusters (Colombo)

Garment Industry (Delhi)

Preparation of Cluster Business Plans

Preparation of Pre-feasibility Studies

These provide a marketing prospectus for a bankable

investment projects


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Brian RobertsLand Equity International www.landequity.com.au

Strategic Planning and Management Services

[email protected]

Thank You
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